Despite 2019’s tumultuous beginning, Bangladesh poised to gain the most from the happening Indian retail

It is not that 2018 ended on a really bad note, rather it has been a prosperous year for the industry on all fronts except a few odd challenges along the way. And as I was looking forward to a grand start in 2019, which I am sure everyone else involved with the industry have been looking up to as well, came in the bolt from the blue – The Workers’Agitation!

With the new minimum wage coming into effect from December ’18, there were some apprehensions, but by and large, the more than 50 per cent increase in wages was expected to give a renewed thrust as to the increased workers’ involvement and industrial growth. However, contrary to the expectations, what unfolded was sheer mayhem! Workers in thousands took to the streets demanding correction of what they alleged discrepancy in the wage structure… Stick-wielding workers stopping cars on the highway and vandalising properties was not the scene that the visiting team of Apparel Online was expecting to see along the DhakaGazipur stretch of the highway. The eight-day long agitation, which came soon after the general election with ministers still settling down in their new roles and responsibilities, did catch the industry and the Government on the wrong foot to some extent.

However, thanks to the Government and the new Commerce Minister Tipu Munshi, it did not take long to bring things under control. A keen observer of the industry, I wasn’t surprised at Munshi’s handling of things. An industry insider and an ex-BGMEA chief, Munshi was in the forefront to douse the fire before it could cause any long-lasting and major damage… A tripartite meeting involving the stakeholders followed soon with assurance from the Government to look into the workers’ demands and hike wages in six grades while leaving the minimum monthly pay unchanged at Taka 8,000.

Things are slowly limping back to normalcy now; it’s the turn of the Government to inject the lost momentum and help the manufacturers deal with increased pressure on the exchequer, thanks to the new minimum wage! The Government hence decided to slash tax at source to 0.25 per cent from the existing 0.60 per cent in an effort to offset the challenges posed by the wage hike. As per the new measure effective from January 1, exporters will have to pay Taka 0.25 instead of Taka 0.60 as tax at source for exporting goods worth Taka 100.

Despite the initial hiccups during the year’s beginning, the outlook for the industry is rather optimistic to say the least. The Government and the industry are not only hopeful of achieving the target of US $ 50 billion by 2021, the Commerce Minister too feels that Bangladesh has what it takes to export apparel worth US $ 100 billion by 2024. And what excites me even more is India’s expected contribution in this whole equation. Deemed by experts as the future of global retail, Bangladesh is already making steady inroads in India and by the Commerce Minister’s admission, Bangladesh’s apparel exports to India could very well touch US $ 2 billion in the next two years.

We, from the house of Apparel Resources, are also trying our best to see to it that Bangladeshi entrepreneurs get a firm and enduring foothold in the Indian retail market. Our Apparel Sourcing Week (ASW), slated to be held in Bangalore on 15th and 16th March 2019 with more than 50 exporters from Bangladesh and 500-plus buyers attending the event, I am sure, will not only boost exports but strengthen bilateral ties even further. I welcome everyone to be a part of this premier sourcing fair and make the most of this opportunity… See you all in Bangalore soon!